Businesses step up hiring in June

U.S. businesses added jobs at a robust pace in June, a private survey found, evidence that rising consumer spending and a healthy housing market are supporting more hiring.

Payroll processor ADP said Wednesday that businesses added 237,000 jobs last month, up from 203,000 in May. That is the most since December, according to the ADP's tally.

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Americans have spent freely in recent months and home sales are running at their best pace in eight years. Construction firms added 19,000 jobs last month, while retail, shipping and utility companies gained 50,000.

On Thursday, the government will issue its official jobs report for June. Economists forecast it will show that employers added 233,000 jobs, and the unemployment rate fell to 5.4 percent from 5.5 percent.

The ADP survey covers only private businesses, however, and frequently diverges from the official figures. In May, the government said employers created 280,000 new jobs, much more than the ADP estimate.

Small companies with fewer than 50 employees accounted for half the total job gains, adding 120,000 jobs. Medium-sized businesses with 50 to 499 workers gained 86,000, and large companies hired only 32,000 new workers.

Manufacturers added 7,000 jobs, their first increase since February. That suggests factories are recovering from headwinds such as the strong dollar, which has risen about 15 percent in value in the past year compared with overseas currencies. That increase makes U.S. goods more expensive overseas, cutting into exports.

The ADP report reinforces other recent data that show the economy is on an upswing. The number of Americans signing contracts to buy homes rose to a nine-year high in May.

And permits to build new homes jumped 11.8 percent in May to the highest level since August 2007.

Consumers are more confident and spending more: a measure of confidence rose more than 17 percent in the past year.